a r t i c l e i n f o We provide a theoretical and empirical study of the relation between financial development and the size of the underground economy. In our theoretical framework agents allocate investment between a low-return technology which can be operated with internal funds, and a high-return technology which requires external finance. Firms can reduce the cost of funding by disclosing...

Crimeware-as-a-service (CaaS) has become a prominent component of the underground economy. CaaS provides a new dimension to cyber crime by making it more organized, automated, and accessible to criminals with limited technical skills. This paper dissects CaaS and explains the essence of the underground economy that has grown around it. The paper also describes the various crimeware services tha...

Researchers have long noted that child support policy for low-income parents may discourage formal child support payments and increase fathers’ participation in the underground economy. Among other factors, low-income fathers may have an incentive to avoid the formal child support system through underground work, since child support order amounts for low-income fathers can be quite high relativ...

Given a vast empirical evidence that cash is widely used in the underground economy, inter-governmental bodies like FATF recommend policy measures aimed at limitation of cash and at combat of money laundering. We show that there is no simple monotone relationship between policy and the size of underground economy, so that the policy has at best a limited scope.

The underground economy has long been of interest to economists and has devoted extensive studies to itself in economic literature. Through fuzzy logic approach in present research, we estimated the size of underground economy of Iran over the period of 1978-2010. For this purpose and according to theoretical bases and previous studies, variables such as GDP per capita, ratio of direct taxes to...

The underground economy (UE) also known as the shadow economy is a phenomenon known throughout the world. The growth of the UE is a matter of increasing concern, at least, throughout the developed nations. Researchers have recognized that the underground economy and crime are linked. Studies on the US, Canada and the transition economies indicate that crime and the shadow economy are facts of l...

The paper examines the effect of inflation on the growth rate in economies with underground, or ”non-market”, sectors. The model incorporates a non-market good into an endogenous growth cash-inadvance economy with human capital. Taxes on labor and capital induce substitution into the non-market sector which avoids such taxes. However the non-market sector uses only cash for exchange and cannot ...

Cyber-criminals around the world are using Internet-based communication channels to establish trade relationships and complete fraudulent transactions. Furthermore, they control and operate publicly accessible information channels that serve as marketplaces for the underground economy. In this work, we present a novel system for automatically monitoring these channels and their participants. Ou...